Life insurance for the young single adult
If you’re young, single and think you don’t need life insurance, you may want to reconsider, especially if you’re paying off student loans.
According to a May 2012 USA Today article, the average student debt load tops $25,000 in the United States and 37 million Americans have student loan debt totaling some $870 billion, according to The Federal Reserve Bank of New York.
That’s a whole lot of debt, some of which you may carry. If you were to die before your debts were paid off, who do you think will have to carry that burden?
Well, depending on the type of debt and its terms, if you had a co-signer, such as you’re parents or grandparent, it will likely be them, or possibly their estate if they are no longer living. Think about that before you say you’re young and single and couldn’t possibly have a need for life insurance. You may need it just as much as someone raising a family.
Truth is, most people rarely consider life insurance while they’re in their 20s because they mistakenly believe it is only something their parents buy to protect themselves in case one of them dies and the surviving spouse is saddled with paying all the expenses.
And although you may not be married yet or, perhaps, like an increasing number of young Americans marriage is not part of your plans for the foreseeable future, your death would still have a financial impact on your loved ones.
Plus, there are actually a number of benefits you gain by purchasing life insurance at a young age.
First, if you were to buy life insurance today, it would likely ensure that you would be eligible for insurance in the future—even if the state of your health changes.
Second, the older you get the more expensive insurance becomes. However, the opposite is usually true if you buy now. The cost of permanent life insurance essentially 'freezes' at the rate when you first purchase it, as long as you continue to pay the premiums.
Look ahead. Who knows what college financing will look like in the future? With permanent life insurance in place, you may be able to take a loan against the cash value of the policy to help your kids or grandkids with their education*. It’s hard to imagine now, but you just never know.
If you are single, don't overlook the need for life insurance. For more information about the types of coverage available, start your research at Individual Life Insurance. Or to talk to a local New York Life agent, click on the Talk to Us button.
* Loans against your policy accrue interest and decrease the death benefit and cash value by the amount of the outstanding loan an interest.